By Ron Kelemen, Next Avenue Contributor
Freedom. Travel. Hobbies. Time with grandchildren. No deadlines. Less stress. Volunteer work. Slower pace. Part-time work. Doing only what you want to do.
These are just a few thoughts that come to mind when we normally think of the term retirement. But I like to think of retirement as financial independence, enabling me to live my dream for the remaining days I have left on this planet.
What’s your vision of retirement? If you don’t have a clear vision and a plan to make it happen, retirement and what it represents may remain an elusive dream. It could be like a road trip without a destination in mind.
Spontaneity can be good, and things just might turn out OK. But then again, you might miss some worthwhile sights or run out of gas along the way.
To figure out what retirement or financial independence means to you, ask yourself some really tough questions, some of which are excerpted below, from my book, The Confident Retirement Journey.
Here are five biggies and help with answers to each:
1. Why do I want to retire?
For some people, retirement isn’t a choice. They are forced into it by their own health or the illness of a spouse or parent. Others retire because they lost their job and face protracted employment searches for positions at significant pay cuts. Some are simply burned out or want to work less at the job they have, but can’t because it’s an all-or-nothing arrangement.
If none of these situations apply in your case, then you really need to understand your motives to retire, especially if you are retiring relatively early.
The whole concept of retirement is built on the assumption that leisure is more fulfilling than work. But for many people, especially those who enjoy their careers, that assumption goes against their need to be productive, which is why we see some financially comfortable people working well into their 70s and beyond. Work can also provide important mental stimulation and a social outlet.
Others see work as part of their identity. When asked what they do for a living, they answer with a verb: “I am a (doctor, lawyer, teacher, etc.).” It could very well be that your idea of a fulfilling retirement is some work or volunteer activity — not because you have to, but because you want to.
Some people view retirement as a solution to their unhappiness at work. They are running away from something, instead of to something. If this is your situation, think about how you can change things at work so your job is more sustainable and enjoyable.
2. What are the most important things I want to accomplish between now and retirement?
Do you have an unpublished paper? Do you want to mentor your successors? Do you have a major project you want to see through to completion? Whatever it is, you can’t launch into retirement on good terms with yourself, and perhaps with colleagues you are leaving behind, without a sense of closure.
Ask yourself: “If I stopped working today, what would remain undone? Who or what would be hurt if I go now? What would I regret not accomplishing? What would give me a strong sense of pride for having completed it?”
Once you come up with the answers, you’ll have a better sense of how soon you might want to retire.
3. What are the most important things I want to accomplish between retirement and the end of my life?
This is the BIG question, the big white board, the big map across the kitchen table. The best way to tackle this one is to start with the end in mind. Imagine that you are looking back on your life. Think about what would be the key things that would lead you to say, “I had a good life.”
Try viewing this as a multidimensional bucket list that includes not only money and the proverbial notches in your belt, but the kind of person you wanted to be in terms of health, relationships, spiritual goals and your impact on others. Then, break these items down into bite-size benchmarks spanning the next one to 25 years.
You can’t travel the world the year before you die, nor can you read all the classics at once. So what is your timeline? What do you want to do now, while you are physically able, and what goals can you accomplish 15 years from now? (My book and its companion website have worksheets to help you with this process.)
Your list and its timeline might be so exciting that you want to retire immediately, if financially feasible. No matter your start date, however, the important point is to get started planning for it.
4. What would be my “perfect day” in each of the four phases of retirement?
Those four retirement phases and your likely level of activity in each are:
Phase 1: Trial — part-time
Phase 2: Early — active
Phase 3: Middle — less active
Phase 4: Final — very inactive
You might need to break down your retirement phases into weeks or seasons, plotting out what you’ll be doing, where, when and with whom.
This retirement-phase exercise does two things. First, it helps you better develop a timeline for the items you identified in Question 3, in terms of your physical and mental abilities. Second, it gives you a context for your goals and their benchmarks, since your plans will will take place within a lifestyle that includes locations, possessions, relationships and daily activities (such as getting exercise or sleeping longer).
5. What about my spouse or significant other?
How do his or her answers compare with yours? Do your retirement visions match? Can the two of you stand to be around each other 24 hours a day? If not, you’d better start thinking about your daily retirement activities. (As I like to joke, “I married my wife for better or worse, but not for lunch every day!”)
The best way to do answer this question is for each of you to answer the four previous ones separately before comparing them. You may be surprised at both the similarities and the differences.